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Disclaimer

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Get more with a Demat Account now!

Mutual Fund | February 28

So, you are ready for share trading. What next? Your broker tells you to
create a Demat account. If you think of this account to merely perform share
trading, think again.

Once upon a time, you needed paper-made share certificates to trade in
stocks. Not anymore, now you just need to open a Demat account for trading
shares. It makes the entire process faster and paperless. It works seamlessly
with a trading account given by a broker. The trading account helps to manage
your trading activities. Also, the Demat account linked with net banking
account makes fund transfer for trading easy.

Why the Demat account becomes necessary?

As per Securities and Exchange Board of India (SEBI), you need a Demat
account to buy or sell shares. In India, you can trade shares on National Stock
Exchange (NSE) and Bombay Stock Exchange (BSE). Use your account to store
shares as per your investment plans, in the form of ETFs.

ETFs or Exchange-Traded Funds are financial instruments to hold assets such as
shares, bonds, commodities and more in electronic format. Anytime, anywhere
trading becomes possible for investors with ETFs.

Here are some facts about Demat accounts

· It is safer compared
to paper shares that could be stolen, duplicated, etc.

· With automated processes, your account
gets credited with funds after the transactions.

· Achieve instant transfer of
securities with a Demat account.

· Depository
participants take care of change of address and transfer of securities. Thus,
saving time and reducing the effort on paperwork.

· With the arrival of
the Demat account, the transaction cost has also reduced.

· You can hold equity as
well as debt instruments in a single Demat account.

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How to open a
Demat account?

You can open a Demat Account only with any brokerage firm. These firms
should be registered as a Depository Participant (DP). DPs register with
NSDL (National Securities Depository Limited) and CDSL (Central Depository
Services Limited). Several Indian brokerage firms and financial services
companies are registered as Depository Participants.

The account opening and maintenance charges for Demat account vary with
brokerage firms. The initial paperwork for opening the account more or less
remains the same. Some banks offer a Demat account clubbed with a user’s bank
account and trading account. Meanwhile, stock brokerage companies provide
benefits and expertise with attractive benefits for new users.

In short, it is ideal to understand what kind of an account works best
for you. Then, invest in the potential of the stock market equipped with your
Demat account now!

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ABOUT THE BLOGGERS

Dinesh ThakkarChairman & Managing Director

Dinesh Thakkar is the Founder & Chairman of Tradebulls Group, one of the fastest growing Indian stock broking house. Mr. Thakkar has over 20 years of rich experience in the Capital & Commodity Market.Dinesh Thakkar is the Founder & Chairman of Tradebulls Group, one of the fastest growing Indian stock broking house. Mr. Thakkar has over 20 years of rich experience in the Capital & Commodity Market.

"Prevent Unauthorized transactions in your Trading/Demat Account --> Update your
mobile numbers/email IDs with your stock brokers/Depository Participant. Receive
alerts/information of your transaction/all debit and other important transactions
in your Trading/ Demat Account directly from Exchange/CDSL at the end of the day
.......... Issued in the interest of investors." | "KYC is one time exercise while
dealing in securities markets - once KYC is done through a SEBI registered intermediary
(broker, DP, Mutual Fund etc.), you need not undergo the same process again when
you approach another intermediary." | "No need to issue cheques by investors while
subscribing to IPO. Just write the bank account number and sign in the application
form to authorize your bank to make payment in case of allotment. No worries for
refund as the money remains in investor's account." |"Investment in Securities Market/Commodity
Market is subject to Market Risk. | RGESS investors kindly download New Retail Investor
Certificate from link -
https://www.cdslindia.com/investors/rgessverification.aspx | Dear Investor
kindly update Aadhar Number with your demat account, contact your nearest branch."